One million in the bank

This happened to a girl back in the late 90’s so I don’t know if it still applies, but she said one day she received a telephone call from her bank asking her to come to a particular branch that she was not familiar with.

She was anxious about it, because she was sure it would be bad news since she had likely bounced some checks due to her poverty. She arrived at the posh bank with swanky marble floors and sky-high columns and shiny brass fixtures, and suddenly several “bankers” in suits “rose from their desks” to greet her and shake her hand. She was led into a side office and plopped down in a plush leather arm chair opposite a big fancy mahogany desk.

It turns out her old childhood friend had just deposited a million dollars in her name after a recent conversation wherein she had lamented to him that she was eating cat food in order to save the better food for her young daughter.

I met her about two or three years after this had happened; she was dating my business partner. She said it was “surreal.” By this time she and her daughter were living entirely off the dividends from the investment of the money, “about $80,000 per year.”


Should I become a millionaire?

Forget Buddha. Let’s talk materialism.

The best food in the world will never come from a restaurant. You don’t even need top-notch ingredients. What you need is a little know-how (not a ton–you want to be a cook, not a three-star chef) and…time.

So if you’re not trading all your hours to make ends meet, and you can do some chopping and then periodically check in on your creation over 4-6 hours, guess what? Your apartment might very well be the best place to eat in the entire city. And if you had pleasurably dropped, oh, maybe a total of $2000–lifetime–on thrift store stereo equipment, vinyl and CDs, plus library annex novels (shocking how good the titles are for $1 to $2) and artbooks ($5 to $10 each), plus a handful of posters with inexpensive frames or mounting…your apartment now looks good, sounds good, smells good, the food you serve in it tastes good, and the place is filled with all kinds of interesting things for guests to pick up and ponder.

Four senses down. And I like your chances for touching, because…

…the sound and smells from your apartment will be noticed. So if you–gasp–knock on a few doors down the hallway, and invite people over for a meal…at a minimum, you’ll have a friendly hallway. At a maximum, you might have a few genuine friends steps from your door, ones who know other people you might like as well. And then–suddenly–there’s an element in your social life that millionaires and billionaires can’t have, because they’re usually booked with all those responsibilities, plus they’ve dropped fortunes for land, security and privacy: effortless, spontaneous evenings.

Oh, and those fabulous restaurants those billionaires and millionaires are going to? They’re spending thousands so…they can’t pick the music, they don’t get seconds, they’re at the mercy of reservations, and they have to leave. Not to mention the fact that a first-rate commercial kitchen is a master class in logistics, and guess what they’re likely not doing? Slow-cooking anyone’s meal for 4-6 hours.

Whereas you dropped $40, most of your cooking time was actually spent watching the football game and listening to music, you ate better and so did your guests, they brought the alcohol, everybody gets seconds, and things end when they end.

You unambitious loser you. How awful. I’m embarrassed for you. You need a vision, a five-year plan, and…oh, um…yes. I am hungry…

By the way, if you live in a city of any size, dollars to donuts, the main/central library not only has a mindwobblingly great collection of art books, poetry chapbooks and jazz, blues and classical CDs and vinyl, it also likely has a librarian sitting quite near them who loves these items.

Talk to him/her. If you do, 1) you’ll be renting someone else’s excellent taste for free while you develop your own, and 2) you can have enticing, memorable material all over your apartment for free, and keep changing it up every three weeks.

Which means you just might become an intriguing, tactile person in a streaming world where everyone says amazing (about things that aren’t) 54 times a day. So get that freaking library card!


Why is healthy food so expensive?

You’re saying food in India is less expensive than in US ? And how is it if you compare it to average salary ? Generally markets follow similar % cost of GDP or Avg Salary when it comes to non-tradable goods – it is easy to export wheat but not as cost effective to move vegetables across the world. You can look at any service, i.e. hairdresser – it will vary between markets, it will vary even between cities, but if you compare this cost to avg salary earned in given location, it will look similar as % ratio.

Food is a product as any other. To produce it you need :
1) land
2) time
3) labor OR capital.

Land, time and labor cost more in US (in absolute terms) which means food should be more expensive (again, in absolute terms). Capital cost is always the same as you can export it easily, thus food production in US has moved from labor-intensive toward capital-intensive, utilizing advancements offered by technology, which helps to produce food cheaper:

1) higher intensity due to GMO/fertilizers etc – less land but also less space used i.e. when “producing” chickens
2) faster (again, GMO, fertilizers – but also hormones and antibiotics in animal feeding)
3) using less labor (cheaper) – machinery, production lines, technology, scale economy

All of the above are making food production cheaper AND less healthy. So why healthy food in US is more expensive ? Because US is a rich country and all non-tradable goods will be more expensive than in poor countries – in absolute terms. Because healthy means fresh and you can’t have fresh moved across the world without adding significant cost – or you need to produce it locally which means all the cost drivers mentioned above.


What is the biggest surprise about getting rich?

I grew up lower middle class and always thought the rich were special. I worked hard, went to university, eventually became a professional and worked my way up. During that time, most of my peers and others in my social strata had the trappings of being rich.

In addition to my day job, I built a business which I eventually sold for low 8 figures. I had much more free time and joined some organizations and clubs, and took up fun hobbies which lead to making deeper social connections with the truly rich – namely people who have $10 million+++ of net worth.

With that perspective of going through that journey, I became better able to sniff out who was truly wealthy, and who was a poseur. What surprised me the most was how many people with fancy cars, who take expensive trips and live luxury lifestyles – who by all appearances we’d call ‘rich’ – are economically hanging on by their nails. They weren’t bad people, just misguided and trying to ‘keep up with the Joneses.’

Looking back at my career when I was a full time professional, more than half my peers were in that category.

The truly rich, namely the self-made ‘millionaires next door’ tend not to flaunt their wealth.

What also surprised me about the truly rich is how much they donate to worthwhile charities, not only publicly but anonymously — far more generously than the poseur class.

Lastly, what surprised me was that the children of the truly wealthy (who grew up their whole life with that wealth), more often than not, tend to have serious sociopathic tendencies.

Something I need to avoid at all costs with my kids (pun intended).